Finger on the Pulse: June Edition

Welcome to the latest edition of the Pulse Blog, providing you with the latest news and audience insights.

Keen for more? Download oOh!media's Quarterly Pulse Report which takes a closer look at audience volumes trends across the quarter, plus much more!

June Audience Volumes Summary

Audience volumes have continued to show positive levels throughout June, with Road and Retail audiences reaching an average of 104% compared to the 52-week rolling average across the reporting period. Recent figures show an average of 105.75% for Road, and 101.75% for Retail for June. Since our last reporting, Office continued to show above average audience volumes and June was no exception with the network reaching an average of 115% for the reporting period. Although Study had a natural taper towards the school holiday period, audience volumes still reached an average of 93.75% (1.)

Throughout the period, there was a significant difference betweenCBD Road and Suburban Audience volumes, indicating a shift towards CBD movement. Coupled with significantly high audience volumes in Office, figures indicate that even amongst flexible working practices, on the whole, audiences' volumes are well and truly back in the city. This is not to discredit Suburban Audience volumes however - with Suburban Road Audience volumes reaching an average 106% for the reporting period. In addition, we are seeing very positive figures within the Retail space, with Local centres maintaining +98% across the reporting period.In factLarge centres this month, reached a peak of 107% for week ending 13thJuneand delivered 133.6mil contacts in that week alone.

Having now reached the midyear mark, overall audience volumes continue to maintain strong numbers across Road, Retail, Office and Study. Even amongst the cool temperatures we are experiencing around the country, the numbers still look positive, and more Australians seem to be spending time Out of Home.

If you want to find out how you can capitalise on this positive growth and connect with more Australians at scale get in touch with your Sales rep today.

A view on consumer spending

The latest Household Spending Intentions report by CommBank show the HSI Index rose by a modest 0.9% in June (taking the index to 117.3). On an annual basis the HSI index is up 11.9% relative to June 2021. CommBank reports they expect to see the interest rate sensitive components of the HIS index weaken further in the coming months given that the RBA lifted interest rates by 50bp in July and further increases are expected in the months ahead. In the meantime, the modest increase in June was relatively 'narrow based', with the big gains coming from Transport (including petrol prices), Education and Household services.

• Transport (+6.7%) With its most recent rise, Transport spending intentions lead the charge in June, which compared to 2021 were up by +132.2%. One of the biggest areas of increase in Transport spending in the year to June was in service stations, which were up a significant 40.5% compared to 2021, due to the higher price of petrol over the reporting period. Taxis, commuter passenger transport (i.e. Trains and other public transport) also saw significant increases.
• Education (+3.7%)  Compared to June 2021, education spending was higher for schools and education services and elementary & secondary schools by +8.0%. Part of the recent strength in Education spending is likely related to a lift in tuition fees for universities and a seasonal bounce after some weakness early in the year.
• Household Services (+2.6%)  Up a strong +14.5% year on year, the Household Services spending intentions index was driven by spending in beauty & barber shops, childcare services, landscaping services, swimming pool sales & service, air-conditioning and concrete contractors. In the month prior there was also an increase in both the number and value on household services which ended up contributing to the position.

It's worth mentioning that the Travel spending intentions index rose by 1.5% in June with an increase in both the number and value of Travel related transactions in June and an increase in Travel related Google searches.

Unsurprisingly Home Buying saw a -3.6% monthly change in June given the recent RBA rate hikes and clear signs of a downturn in dwelling prices in Australia. According to Commbank cite. Corelogic, it's something we can expect to see well into 2023. (2.)

Economic uncertainties no match for Advertising growth

June saw consumer confidence take another dip because of surging inflation and rising interest rates. The Westpac-Melbourne Institute consumer sentiment index decreased to 86.4 in June from 90.4 in May, indicating that there were more pessimists than optimists among Australian consumers.

According to the Guardian, experts are saying that stretched businesses could face further pain as people cut spending and award wages rise. They cited Westpac's economic spokesperson, Bill Evans, who said the survey showed "a clear picture of a slump in sentiment being driven by rising inflation; an associated lift in interest rates; and a loss of confidence around the economic outlook, both here and abroad" (3.)

It's an outlook that recent figures from Deloitte's Global State of the Consumer Tracker echoes, with the survey date (28th June 2022) reporting that 80% of Australians are concerned prices for everyday purchase are going up and are concerned about inflation. However, despite a rising cost-of-living, Deloitte also reports that discretionary spending intentions are generally holding steady. Consistent with previous months, consumer plan to allocate roughly one-third of their budget to more discretionary purchases in Australia. Categories such as recreation and entertainment, restaurants and leisure travel continue to signal healthy demand (4.)

So, what does this outlook mean for Advertisers? Well Global advertising spend is expected to increase by 8.7% in 2022, according to Dentsu's latest report and the Australian market is expected to reach A$19.2 billion by the end of this year with a forecast 6.7% year-on-year growth - up from 6.1% in the previous report and paints a positive picture despite the likelihood of economic uncertainty throughout the year (5.). Peter Huijboom, Global CEO, Media and Global Clients, Dentsu International said, "Even with everything which has happened in recent months, not least the protracted war in Ukraine and its international repercussions, the advertising recovery remains strong on a global scale. And, despite factors such as inflation putting pressure on household budgets, combined with 2021 being a tough comparative year, we have only marginally revised down our 2022 growth forecast by just 0.4 percentage points (5.).

Business Travel is taking off as agents see a renaissance

New Australian Bureau of Statistics (ABS) data released in June showed the number of trips in and out of Australia has almost doubled since March and in May, alone there were over 1.3 million international trips that took place (6.) In addition, recent NAB data showed that their customers spent $46 million on international flights, accommodation, car rentals, cruises, trains and travel agents in May, the largest monthly spend in three years. In comparison, customers spent $43 million on international travel plans in May 2019. In fact, between January 1 and May 31, NAB customers spent $157 million on overseas travel compared with $23 million in the same period last year (7.).

Australian Federation of Travel Agents Chief Executive Dean Long said lingering concerns that COVID-19 restrictions could re-emerge were behind a major change to the way people plan their trips and agents were seeing a 'renaissance', with people anxious about meeting varying entry and exit requirements, including pre- and post-departure testing as well as minimum levels of insurance coverage for COVID-19 medical expenses. According to Long, International travel has seen the strongest return, with airfare sales up 404 percent, and 16 percent of all new enquiries to travel agents coming from people who had not used one in the two years before the pandemic (8.)

Travel agents had also reported a strong recovery in business travel with domestic bookings up 74% on the lows of 2021 (8.). According to the latest figures from Deloitte, business travel is also on the rise, with 78% of Australians stating they will likely travel for business within the next three months, up from 67% in May. It also showed only a small percentage of Australians (3 out of 10) agreed that technology had replaced the travel they might normally do. Among consumers planning a business trip in the next 3 months, the primary reasons are to attend a conference, exhibition, or tradeshow (29%), build client relationships (22%) and work with clients (16%). With globally roughly 6 in 10 consumers whose job normally requires business travel, plan to take a business trip within the next three months - it's a sign that temper early predictions that the pandemic would significantly lower business demand (4.).

Sources

1. oOh! Smart Reach, DSpark, aggregated weekly total volumes Road, Retail, Office, Café and Study locations nationally, period week ending 27th of June 2022. Reporting period classified as week ending 6th June 2022 - 27th June 2022
2. Economic Insights | Global Economic & Markets Research | HSI: Household Spending Intentions | June 2022, CommBank
3. https://www.theguardian.com/australia-news/2022/jun/15/consumer-confidence-plunges-to-worst-level-since-peak-of-pandemic-westpac-survey-shows
4. https://www2.deloitte.com/us/en/insights/industry/retail-distribution/consumer-behavior-trends-state-of-the-consumer-tracker.html
5. dentsu Global Ad Spend Forecast Report, July 2022
6. https://www.abc.net.au/news/2022-06-15/aussies-heading-overseas-double-since-borders-open-but-still-lag/101155148
7. https://news.nab.com.au/news/overseas-travel/
8. https://www.abc.net.au/news/2022-06-26/australians-changing-travel-habits-after-lockdowns/101124824